little -- 11 out of 12 days, this is, oh, by the way, we're in the super bowl. >> yes. no tears from ray lewis is what you're saying. meanwhile, the macro has been at our back in china, and here in the states. d.c. has given us a temporary breather. i wonder if and when those things come back to haunt us, if they do. >> they may well, and the thing that kind of disturbs me, you do this for 50 years and when i walk in a room, i look for the exit sign to make sure i'm ready in case things change. there is no geopolitics as far as i can tell priced into this market. we have had an israeli election, the president's hurled down the gauntlet in the inaugural speech. you've got things going on in the middle east that are border line crazy. it looks like iraq may be getting destabilized. not a tick here. not a tick. >> that's been your complaint for a while. >> and it has. and they still remain asleep.

i cannot believe that that will continue for any length of time. >> i have a feeling we'll come back to this conversation and look at it later on. our thanks again for stopping by. art cash. that does it for us on "squawk on the street." back to headquarters as we hit noon. scott wapner and the "fast money halftime report." carl, thank you very much. welcome to "the halftime show." four hours to go until the close. let's walk to the wall and see where we stand. dow is adding to its gains, up 86 points. there is the big number to keep an eye on, the s&p 500, above 1500. here is what we're following on "halftime". the apple aftermath. with the stock suffering its worst klidecline in four years, will it lose the tight. the most valuable company on earth? a critical earnings report looms. one stock, two traders in a halftime battle. first, our top story is the rally. no apple, no problem for the markets today which are surging again.

the s&p 500 topping 1500 for first time since december of 2007. stephanie link what does it say about the market that apple is suffering one of its worst days in many, many years and we're talking about 1500 on the s&p? >> i this very impressive that the market is higher. i think that speaks to the global recovery that we have been talking about ad nauseam over the last several months. look at the u.s. data, initial claims at a five-year low, leading economic indicators, china flash pmi, better than expected overnight. europe, a three-month rally actually. i think you can make a case that the economic data is getting better, that earnings, those people concerned about earnings, well, i think you can make a case your trough earnings because you have a better global picture. i go back to companies that i listen to on the conference calls, slumberje, general electric, all of them saying you are seeing this recovery.

>> dr. j., impressed yet? >> oh, yeah. >> you've been a hard guy to impress. >> i've been very impressed several times. i haven't thrown a ton of money at it except through options. when you look at apple and see that big decline, and then look at the past month, and see that it is down 11%, meanwhile, the s&p is up 5, the s&p, all the people who thought that if apple went down, we couldn't rally, have been dead wrong and the people that have been using that as a hedge against their apple have really been taking it in the pants. >> this is a statement day for the stock market. it is saying we don't need the most valuable company on earth to lead us higher. the s&p 500 is above 1500 for the first time since december of 2007. how powerful is the statement? >> very powerful, very powerful for those that have a longer term view of the market and powerful in the sense of potentially seeing what seems to have paused, which is the outflows out of the fixed income space into equities themselves. this is overall very good. i love the performance of

energy, which i have not done a good job talking about in the last couple of weeks. it is time to talk about energy once again. it is leading the market higher. i will tell you on apple, i think apple is trading today horribly given the way the tape is. >> how do you see things now? >> i'm bullish, remain bullish. i think you have a good setup here. the thing that troubles me is everybody seems to be positive on the market. they're not talking with their cash yet. i think there are a number of people, a number of institutions still underinvested. heard lee coopman come on looking for 1600 this year. that's not an aggressive target. so i think there is plenty of room in the market. didn't talk about claims, jobless claims today was a very strong number, and we'll get the employment number next friday. my guess is that's going to be a shocking number in terms of how good it is. so everything seems to be hitting and the crowd can be right. we're going higher. >> at the same time, look, the

last week or so, two weeks we have been talking about the amount of money coming into equity, mutual funds was at the highest levels in a number of years. that's -- what kind of sign is that for the market? >> the retail investor has been out for years. it is going to a long time for money to come back in and it is supportive again of -- if there are things getting better and valuations aren't stretched, i think you can see multiple expansion. i think that earnings and guidance very, very conservative and beatable going forward. >> talk to anyone in the institutional side, if you talk to the folks in davos, talking about the yen, talking about the yen again, down today, 1.5%. why is that important? because the global carry trade places the yen back as that funding currency, that's very favorable for risk assets, you sell the yen, and you go out and take the funds and buying global risk assets with it. >> our next guest isn't buying the rally at all and says you shouldn't be either. gina martin adams covers the markets for wells fargo, joins me live from new york city.

welcome back to "halftime." nice to see you. >> nice to see you too. >> you're a party pooper, why aren't you smiling? >> i'm still pretty bearish toward the market. >> what data are you looking at? we have the best eurozone pmis in months. the china train wreck ain't a train wreck. >> the data i'm looking at is earnings. unfortunately we lost a lot of our earnings push for the market. starting in the fall of 2012. and this entire rally has been based on valuation. investors seem to be willing to look through pretty extraordinary weakness in the earnings stream, the beat ratio on the s&p so far this season is well below average, consistent with the last two quarters of earnings. we're looking for the turn around in earnings that investors are so desperately starting the price into stocks and just not seeing it. >> we're looking at different data. what i see in terms of the beat

ratio, talking about a beat ratio, not underperform ratio, is that you have, i think it is 70% to 80% of s&p companies have reported better on the top line and bottom line. but the other point is that companies are the leanest they have ever been with the most cash they have ever had in an improving global economy. you can very well be at the trough in terms of s&p growth. you're going to move a lot higher. >> well, you know, maybe we are looking at different data. at least through friday the beat ratio and the s&p 500 was just 59% versus a long-term average of 65%. and frankly, if you're looking at cash ratios, these were arguments we used in 2007 as well. cash is a share of assets consistently driven to higher and higher levels for the last 15 years. i'm not sure that's a bullish point for the short-term. i think instead you want to focus on the earnings stream and whether or not these companies can beat expectations going forward. >> what were you looking for in terms of the beat ratio or maybe

it was the misratio coming to this quarter so far. in 16 and 65, that's basically, you know, insignificant as far as i'm concerned. what were you looking for? >> the long-term average is 65%. at least over the cycle. so companies tend to always beat earnings estimates. even going down to a 60% level is below average. i would like to see something above 65%. >> gina, let's talk about the macro environment. it is getting better. and what the market looks for is those -- those incremental data points, the new pieces of news. whether they're actually really good or just a little bit better than people expected or better than bad. so where are your thoughts on the economy, here in the states as well as globally, and how do you position for that? >> right. so when we look at the broader economic landscape, we use the leading economic indicators index which improved a touch in december. but it is still down on a year over year basis. or decelerating i should say on a year over year basis, tends to

be the best leading indicator of earnings growth for the s&p 500 over time. i think unfortunately this is all perceptions with respect to the economic data. instead the leis are continuing to decelerate. some of the leading indicators have done a little bit of better in the december, november, december period versus the prior three months. but on the longer term scale, we see this ongoing desell ration. >> you don't think the monetary policies that are going around the globe are going to help those data points get better? >> doesn't seem that way. we had announcements now, the ecb announcement in the summer months, the fed announcement in september and december. it just resulted in a desell ration. >> i don't think anyone will argue with you that earnings are weaker but maybe they'll get better from here. >> that is certainly the consensus expectation. the consensus expectation implies that the third quarter of 2012 was the trough for earnings at about a 2% to 3% growth rate and just continues to improve through 2013.

unfortunately my model suggests instead the trough is sometime in the first half of this year. and that flies in the face of expectations now. i don't think we're pricing in further earnings weakness. we're trying to look forward and pricing in much better conditions going forward. >> good to have you on the show. thank you for coming on. with a smile, to defend your call, which is certainly a contrarian play as we look at the s&p 500 today. >> it is the lowest price target on the street. it is 1390. 1390. >> the markets are discounting. i would say that -- i admire people that come out and stick their neck out and take the contrarian point of view. if according to her numbers we trough midyear, the market will continue to move higher. six months discounting in terms of market average is great. by the way, she should update her numbers because the beats are within my range, not 59. a lot of companies have reported

since last friday. >> 68%, companies that have reported thus far have beat, only 16% missed. >> i think what has to be on your radar, we have an fomc meeting next week. i don't expect any shift in monetary policy. go back to 2012, in april, you had that peak in the s&p. the federal reserve told us things were getting better, labor conditions were improving. in september, they told us the economy needs all the help again. that brings a high in the s&p. i this i it isnk it is a shift monetary policy. let's do this. let's give the payoff, to the folks watching and say, okay, you're overwheping ioverwhelmi large bullish. where do you want to be? you mentioned energy? where are the places to be within the market if we believe what you say? zblif . >> within equities, financials continue to work, i think discretionary is surprising right now to the upside.

energy coming out of in where and she suggests health care which year to date, josh brown mentioned this, health care has been a sector to be in. >> i think industrials could be interesting. they're the least owned stocks or sector at this point by institutional money managers. so i think it is not going to take a lot to see a little bit of a rotation. look at the stocks. utx, ge, they're not staying down on these guidance. these stocks are up nicely. there is more that can go. >> some are overvalued. look at cei, the stock is up 50% from that level. i'll tell you the contrary place i would be, i would short the safety trades. i would short the spread. i would short german bounds. i would be short every place people want to hide over the last couple of years because they're going to reverse. in reason to be there. >> just real quick, look at the durables. look at brunswick today, that stock moving 6.5%, 7%.

harley-davidson, look at whirlpool, which continued to work and because of some rulings is going to work well into this next quarter. i think you look at those durables right now. >> the trend is your friend, sorry, scott. >> let's go to the market flash desk for a look at what is moving. there say lot moving today. >> there is. what we're watching, scott, is research in motion. a familiar stock this show. we debated it a lot. it is touching a new 52-week high today, on back of a report from bloomberg that caught up with the cfo in davos who said they might consider a bid for rim. that's the lenovo ceo. there might actually be a bidder in the wing, whether they made a bid yet is something pushing up the stock today. >> pete has been on this one, he talks about the beta trade. whenever anybody tried lure him

into the apple debate, he said beta, beta, beta, get it with rim. now with lenovo saying they would consider this as well as other opportunities, i think this puts the focus on this one. i think it is part of the reason that even though nokia pulled back on their div and the stock traded down to $4, it rebounded about 30 cents as well, i think the space is interesting. >> sell early? >> i still have -- sold yesterday. no chance of a canadian government letting a chinese company buy rim. somebody else may, but that won't happen. >> no chance of u.s. corporations doing business with a hardware/software maker owned by a chinese company. >> coming up on "halftime," shares of apple dropping on a big earnings disappointment. is there a bottom in sight for what is america's most valuable company, but that could change. we'll ask ubs' steve milunovich. will tonight's profit report get investors excited about the

stock again? two traders, two opinions, one heated debate is coming up.

welcome back. the guys at five were told that the price target on apple could be hit soon following the company's disappointing earns. >> well, i think it is coming this year for sure. that's an awfully long time

window. i think the way it is looking now, it should happen this quarter. >> talk like that raises the question, where is the bottom in apple? let's ask one of the top rated analysts on the street. steve milunovich joins us live from new york city. steve, always a pleasure. welcome back. >> thank you for having me. >> are you surprised the stock sold off as sharply as it has. >> i am surprised. 10% drop seems a little extreme. the company has issues, but it is performing well. in retrospect i think the problem was that so many people are bullish on the company, sell side, uniformly bullish, few short positions in the stock, just, like, nobody else to turn positive. so we're tending to go back the other way right now. and that 425 target may turn out to be a relatively good guess at the bottom. >> you cut your price target twice in the span of, what, three days, two or three days. i'm curious as to why you put out a note today, which highlights things like lost year

of earnings growth, needs a catalyst, estimate revisions, and yet you still have a buy on the stock. want to change that? >> no, we don't want to change that. in retrospect we should have changed it. but we do believe particularly taking a 6 to 12 month view we think there is upside in the stock. the problem is that we don't see a lot of near term catalyst, which is why you could see the stock drift lower in the near term. talking to investors, a lot of people are sitting on the sidelines, interested in the name here, but you need a catalyst, which could be the 5s this summer, perhaps a low end phone coming later this year. and certainly i think people like to see them use some of the cash to buy back stock. >> what is the right multiple that apple should be trading at? you take where the stock is now, given the earnings, it is about 11 times or something like that? >> it is, but only eight times excluding cash. >> right. if you take the cash into consideration. where should it be? what is the fair number? >> i don't think that's a bad

number. we have written that over time, you do expect the multiple to contract once revenue growth peaked. that's true for microsoft and google, true for apple as well. not arguing there is going to be a lot of pe expansion. to get some expansion, maybe get it up to maybe 10 times excluding cash, you need innovation. steve jobs talked about this many times, the company needs to innovate. and frankly investors have lost faith that the company will do that. i think that's probably going to prove to be premature. but they have got 500 million users of ios. have to find a way to monetize those with new devices and find a way to bring new people into the tent, particularly emerging markets where a low end phone could be helpful. >> hurtful to margins, though. >> focused on growth margins. with a low end phone, you hope the elasticity will be sufficient, it could have a lower margin but close to the corporate average.

you'll get more unit growth. at the end of the day, you want to grow dollars of operating profit, dollars of earnings, we can live with a lower growth margin. >> you say in your note today there is little excuse to not accelerate stock repurchase. are they going to do that and jim cramer yesterday said, he tweeted out, i believe, during the conference call, that it was arrogant of apple, not even to address the nacfact that they'r sitting on a mountain of cash, not to address at all what they're going to do with it. >> they have been very conservative and dividend, for example, would be more a board decision and so forth. i think they're going to have to do something, particularly as value investors get more involved in the stock. 80% plus of that is overseas. they got plenty of money to buy back with. the fact is the stock is probably not going to work longer term because they buy back stock, won't enhance the multiple. but it is an important step to show the street that they have

confidence. they talk about a full pipeline of products, but we haven't seen anything recently. they need essentially to convince investors, they're back on the offensive. they're lengthening the lead over samsung. creating in product categories, very defensive the last three to six months. >> could you talk about what is happening in the laptop, in the desktop business. didn't they also miss meaningfully there on the laptops and there is lots of rumors in the marketplace about major discounts there. so it is fair to say then nothing is really hitting on all cylinders at this point in the company. >> well, they were supply constrained on a number of products. the phones, through most of the quarter, and the desktops. perhaps wasn't great execution, but they were very much constrained. so we do, in fact, look for a bounceback next quarter in the mac business, which is part of the reason that the gross margin might come in lower than people expected. not part of the company that is going to be a key driver, but it did hurt revenue in the quarter. we expect them to make some of that up in the march period.

>> i'm just wondering, steve, you know, finally, save for reinventing the wheel, what would be so innovative from apple's standpoint that it could be that next level product. you could say it could be a television, but you also have to figure that a television is going to be a hell of a lot more expensive than the iphones are. so the premium buyers buying the highest level of iphone may not buy television, certainly in the same numbers. what is going to be the transformational product. they already have a phone. they already have a mini tablet, a regular tablet and computers. >> it is not easy to think about what is going to be as pervasively used at a high selling price as a phone. it is a unique product. it could be wearable computing. i think they should be doing more in services. they have created this significant ecosystem which i think is very valuable. 500 people using apple, the brand means something, families use this, they have got to find more ways to monetize that. some of those might be devices.

i think they should be on the services side. that's where i think there is real opportunity over time and also would get apple away from being perceived as a hardware company. many investors i talked to are concerned that longer term, hardware companies like rim, nokia, don't maintain 30% operating margins over time. so a little bit like ibm back in the day. need to move away from hardware and get more software and service revenue. >> you're saying apple needs s make a deal. that's what i hear. >> arguably that would be part of it, yeah. i do think they have got ideas of devices they will create and innovate. i don't think that game is over. i think they can very much complement that with services and some of that might be through acquisition. >> steve, good to talk to you. >> thank you very much. >> steve, ubs. what do you make of the comments? >> services doesn't work for them. they're not a business to business company. it worked for ibm because they had a great foot hold in the

business sector. apple is not there. >> there aren't a lot of catalysts here. at the very best you have a trading range stock. might be oversold today. if you just now missed the quarter, for the last three quarters, you missed gross margins for the last four quarters, now in a show me mode. there were a lot of great growth numbers and dynamics. but a lot of people own this stock. i think it is a trading range at best. >> there was nothing really compelling in what they brought out yesterday, judge. i don't know we're going to get something all that compelling other than an oversold condition that stephanie mentions. i think we're close to that. but unfortunately the innovation we're looking for that's what we need to see. when he says services, one exception i'll take with you on that is i think they could expand in services and i think because of that ecosystem they have, judge, when you look at the profit margin, when they're taking 30% for the apps, taking 30 cre 30 cents for the music they sell on itunes, there is a lot they

could be doing from something that costs them nothing. just to operate that website is all it costs them for them to make those revenues. >> the biggest pops and drops now in midday trading. big drop from mccormick. >> mccormick, spicy quarter, judge. this stock moves ten cents a day. here it is making a huge drop today because of some significant misses. i'm not overplaying that. that's why people are heading for the exits in the secretarier. >> bed, bath and beyond. >> upgraded today. a disappointing company last year, underperformed all the housing stock. it is cheap, but still in show me mode. >> southern copper. >> morgan stanley downgraded it based on valuation. it is the only group play in copper. has a fat deal, stocks going higher. >> f5. >> slight beat, not much to write home about here. it is jumping above the average, at 102.

give this a couple of days before you step in and buy it. make sure the confirmation will hold. >> pop for gary the goat. an australian animal will stay out of the pen after being cleared of vandalism chargers. he was charged with destruction of property after the pet chowed down on flowers outside a sydney museum. he was cleared. now the guilt free goat isn't being sheepish about his new found fame. on "halftime," from a major airline to a big industrial, trades on the biggest earnings movers. and later, netflix, hot stock today and hotly debeated on the desk here. should you sell in today's rally? this is $100,000.

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welcome back. time now for our top three trades. first up, nokia. it is lower. not really on the earnings doc. this is about the dividend. >> first time in 20 years they have cut the dividend or put a pause on it, judge. and perhaps that's because, well, with lumia being successful, that's the positive. they're running into shortages and maybe need that cash so they can help some of the suppliers so they have enough on -- in stock it meet the demand. >> southwest airlines, stock up 1.5%. beat earnings estimates but says they saw higher operating expenses and decline in traffic. >> but the stock is up. here is the story. what is amazing to me, i've never seen this in my career, is that the airlines have traded up as crudes traded up. what that tells you is the dynamics in the industry is different. they have monopoly pricing in their markets. so they're very efficient right now. they're actually turning it to good investments. they all go higher, i believe.

>> a number of years since you heard people say that, right? >> never heard it before. >> the company matching expectations, saw sales growth across its business lines. you were talking about this earlier. >> the company, yeah, they reported in line. organic growth was much stronger than expected. and what is important about the industrials is as i said before, i think a lot of companies are going to lower guidance. whether we look through that or not is a question they seem to be doing right now. it is a little bit more expensive, i prefer utx, but on a pullback, it is effective. >> to jackie deangelis, host of cnbc.com's "futures now". >> the catalyst for the sell-off, better than expected jobless claims. so if the economy is getting better, do you want to stay out of gold? let's talk futures now. anthony is at the nynex. explain why good jobs numbers are bad for gold.

>> it is two good jobs numbers in a row with the claims numbers. you remember the fed said they were looking for substantial gains in the employment market before they would take their foot off the liquidity gas pedal. that's a logical market reaction to take the top off gold. the other reason is that the yen turned around again, which gives us a small perception of dollar strength or stability. that reason has been going on for a couple of weeks. i think it is somewhat illogical. there is no payday. the jobs numbers is a big deal. >> this is a second time in a month that gold has failed to crack that $1700 level. you got to wonder how significant that is, right? >> yeah, jackie. it is pretty big. i talked to the traders down here in the pits, they look at the gold market as i want to be an investor in gold, i want to own gold, but i don't want to trade gold right now. as jim said, that jobs number was good, and you have to crawl before you walk. and this looks like it is starting to crawl. this is two weeks in a row we

got it. you look at the chart of gold, your support now is on the lows of today, that 1664 area, below that is 65. and i won't even mention anything on the upside until that 1696, 1700, that's where the real resistance is. >> range bound again. now you know how our guys are trading gold. how about you? do you think it will end lower or higher? log on now and vote in our poll. once there, watch our show today, because we have got jim grant, also doug kass, doug called apple's demise on tuesday. what does he see for apple now? tune in to find out 1:00 p.m. eastern time. microsoft in the green. but we'll dig beneath the surfa surface. can you trust today's 40% move in netflix? herb greenberg joins the desk when "halftime" returns.

halfway through the trading day. next, we cover the day's bounces, the island reversals, the breakouts and breakdowns in pops and drops. s dumb money trades in the morning and the smart money trades into the close. so we reveal what that smart money is buying and trading before that final bell tolls. ♪ [ cows moo ] [ sizzling ] more rain... [ thunder rumbles ] ♪ [ male announcer ] when the world moves... futures move first. learn futures from experienced pros with dedicated chats and daily live webinars. and trade with papermoney to test-drive the market. ♪ all on thinkorswim. from td ameritrade.

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just about three hours left to trade. microsoft before it report s earnings after the bell today. stock's done nothing. why bullish? >> that's one of the reasons, right? the expectations are low. really a bad performer last year. very cheap stock at 8.8 times earnings. a lot of the pc news, the weakness is known. there is more to the story. there is server and tools, enterprise, entertainment. all those divisions i expect to see improvement tonight, double digits. i think we can get past this bad news, the stock has done a great

job in terms of returning cash to shareholders. they have almost $8 a share in cash. >> compelling case. what's wrong with that? i dozed off. we were talking about microsoft? it is one of the most boring stock out there. residual revenue stream, good, but tied to pc growth. despite the cash, despite what we have been talking about for years and years, always been a narrow trading range. good place to go if you want safety, has a decent yield. if you want growth, come on, best acquisition they can make now is putting $2 billion up for dell, go somewhere else. be creative. i want to generate a little alpha in the market. i don't want to follow the market. i'll go to a stock that may be more expensive, but has significantly better growth characteristic. >> i didn't say it was a good growth story, good value story. first thing i said out of my mouth, trading at 8.8 times. they have seen decelerating

growth. microsoft has other areas -- at least microsoft has other areas beyond pcs that they're focusing on growing. and look at those numbers tonight. all the various different segments they grow double digits. >> those are cue cards you could have used for last four years. it doesn't work. that's the catch all phrase. >> i don't agree with that. >> ever see civil war movie where -- >> not all ideas -- >> they line up shooters row after row after row and then they shoot them down row after row after row. those areal have y le havvalue have died in the graveyard of microsoft. >> dr. j, who made the more compelling argument? >> i want that to keep going. this is something like antemy. i think the surface will be a big winner for these guys. they're moving the right way. i'm a bull on this one, sorry, steven. >> speaking of debates, we had a spirited one on netflix last

month. here is what joe and stephanie to say. >> joe, our bull, stephanie, our bear. let's debate it. >> this disney deal in 2016, in my estimation, places a put underneath the stock itself. >> it got domestic issues. you got the company that still is expanding international which margin pressures will continue. >> at some point you have icahn on your side. >> also competition. >> joey? >> i would not short that stock. >> more than a decade. >> i would not short the stock. probably continue to move higher, but for myself and my book, it is time to seek the exits and that's what i'm doing. >> let's bring in herb greenberg, who always has an interesting take. are you a believer? >> i make a living out of standing in front of speeding locomotives. this will be no different. >> bag on the highway and i'm the big truck coming at you. >> as one of the guys said, the only thing that is a blowout is

the stock price. when you take a look at this and go and look down and say what is going on here, revenue growth, actually going the wrong direction, cash flow growth going the wrong direction. you got the eps, you can argue they're irrelevant when you want to look at the accounting and look at that off balance sheet, $3 billion. >> they post a profit and the streak is looking for a loss. >> that's because the street wants to look at the easy numbers. so i went out and said i wanted to know how does this compare to cable? cable can be an interesting analogy here. >> hbo is competitive. >> i was talking to a short seller who has been around for a long time and was definitely involved in the cable names. i said what is the comparison here? he gave me an interesting metric. he said revenue growth to employed capital. in cable, 10% to 15%. he said with netflix, it is closer to 10% to 50%. and i said, well, come on,et'st amazon.com, to me, is the sort of ultimate tomorrow, tomorrow

story and wall street wants to ignore it. he said a much better business. like the old dell. you have the suppliers financing the business, don't have the big off balance sheet hanging out there. the bottom line, he said, look, if you have revenue growing, below the cost of capital, bottom line, ain't good. now, the wall street, have i seen the stories so many times before? i got the tracks on my back to prove it. yes. but as i tweeted out this morning, this company right now with what is going on cannot afford any more quickster bound blunders, not even a mishap. >> who can? >> amazon has been able to. amazon has been able to. amazon is one of those companies that people look out -- they can give you every metric of why this company shouldn't be priced where it is. >> maybe they had this one wrong. maybe reed gets the last laugh. >> maybe it is difficult to call tops and bottoms in stocks. you may be right ultimately, but as long as momentum is there -- >> you're talking about a stock. >> exactly.

that's what we do, invest in stocks. >> you're talking about stocks. stocks are the underlying thing in a stock is a company and a business. sometimes at some point those fundamentals have to work. this company has to make money and that $3 billion out there, somewhere, has to come home. >> poker you don't have to show your cards until -- >> why does carl icahn get into herbal life? he's a richer man. he can make the trades on the stock. >> because of the 25% short interest. that was part of it and you knew one of the guys was, like i said, a blood sport -- >> playing the fabulous short squeeze which people have been doing is a moneymaker. >> herb, thanks, man. good to see you. all right, coming up on "halftime," the biggest players in business and politics are in davos, switzerland. should you be betting on a eurozone recovery? the answer and the play when "halftime" continues.

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a very busy hour of power at the top of the hour. the s&p 500 briefly through 1500 earlier today. we'll show you where the smart money is going in two key sectors, airlines and housing. all about the expectations. netflix barely beat them. apple barely met them. we'll tell you why one stock took off while the other one sank. and we're traveling across the country to phoenix, arizona, to take a look at this property. you won't believe the price tag. there it is. it is a castle. scott, just like your own. >> yeah, i wish. in my dreams, thanks. see you at the top of the hour. mover and shakers gathering in davos at the world economic forum. scott joining us with the hottest trades out of davos. good to see you. >> thanks for having me on again. let's talk about apple. >> i want to talk about apple. i want to talk -- i want to talk about apple. what is the scuttlebutt out

there, what are they saying? >> apple is not here. you have microsoft here, yahoo! google is not here. they're always here. the big issue for apple is the innovation question. i think that's what is suppressing the multiple. we had a board of governors meeting from 12:00 to 3:00 today, there were probably 20 hedge fund managers in that room and 15 private equity guys, all the well known players. apple is trading into the single digits on an eps basis. if you're low on that stock, hold it. there is a lot of new things coming from apple. they don't come at the pace or with the pizzazz as steve jobs presented on behalf of the company. but i think they're going to do very well and surprise people here and so i would hold apple. but i also think you got to cover the short on blackberry. last night, i got the opportunity to meet with some of the guys from blackberry. and looked at the new phone. at 5:30 this afternoon, they did

a demo of the phone. i think the phone is fascinating and there is still a great install base for blackberry. those are two key trades that actionable things coming out of davos today. >> that would be research in motion, of course. what about big picture? the market in general, right? we're at 1500, anthony, on the s&p 500. are there believers in davos that this thing continues? >> well, i'll tell you something that i heard today, and this came from dan lobe, one of my favorite investors and a dear friend. the age of accommodation is not coming to an end right now, but in fact it looks like it is peaking. but 18 months from now, this is what investors get paid to do, look out 18 to 24 months, there will be less accommodation and a return to normalcy, and so it will be very interesting to see where markets will be. he's calling for a return to

price discovery in markets, where just about everything levitating upwards, scott, and will require much more sophisticated security by security analysis. just an interesting contrarian call here because the number one theme here is that this is a race to the bottom for all the currencies. >> enjoy all right. enjoy your lunch with dan loeb. let me know what he says about herbalife. >> i thought you were going to ask me about rabini. >> we are out of time. weeg do that next time. >> all right. >> new data out of germany points towards signs of a strengthening eurozone recovery but will the rally continue? let's bring in andy bush of the bush update. i guess that's one of the big questions. the stock market is wondering if it continues. >> the euro is really interesting here. every other country out there views the weak dollar as a

problem except for the ecp. this is insanity on their part. even the bank of canada backed down on their hawkish commentary. the only country not doing this for the area is the eurozone. so this is awesome. even euro aussie fell quite a bit. then the little question of the uk pulling out of the eurozone. that's helping the euro stand tall even though these other currencies weakened quite a bit. >> what about the other levels? you weaken the chart and that is not far from 135. what kind of trade do you want to make? >> right. a real short term one and based on the ltro bank pay back tomorrow that we get out of the ecp. basically the mark set looking for a hundred billion on this. if it is above 125 if it is above above euros. so i will take a chance this things goes up so i want it buy

at 133.25 and look for 150 point on the upside. again, short term trade. the ecb doesn't get it and should not be talking a stronger euro. >> you can catch more currency trading in money in motion every friday at 5:30 p.m. eastern. >> coming up on the half, you asked for it on twitter. playing on everything from wal-mart, ups and many more as well, so you can get in on the game. more "halftime" in two minutes.

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when you, the viewers ask, we deliver. stocks that blow up my twitter feed, wal-mart, ups, eog resources and open table. what's the trade? >> i think it is fully valued. >> open table, doc, what do you do with that trade? we know i use it all the time. >> i will fold it. i'm going to fold open table. i like what they've done but i think a lot of the restaurants when are bringing on now are not long-term subscribers to their system, even though i like their service. >> steph, deliver us the verdict on ups.

how do you trade sna that? >> i like ups but i like fdx better. >> you like fedex better, okay. finally, eog, joey? >> excellence presence with 125 bucks, i think it gets to 130, holding. >> we do this everyday. final trades are up next on "halftime." ♪ you know my heart burns for you... ♪ i'm up next, but now i'm singing the heartburn blues. hold on, prilosec isn't for fast relief. cue up alka-seltzer. it stops heartburn fast. ♪ oh what a relief it is!

cue up alka-seltzer. it stops heartburn fast. try running four.ning a restaurant is hard, fortunately we've got ink.